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Commentary

Amazon And Google Race To The Zero Moment Of Truth

Late last week, the Wall Street Journal broke news that Amazon is “gearing up
to more directly challenge Google’s dominance of the online advertising market, developing its own software for placing ads online that could leverage its knowledge of millions of Web
shoppers.”

What we have here is a race to the Zero Moment of Truth. ZMOT is a term coined by Jim Lecinski at
Google back in 2011 and the topic of a great ebook (see my review here). Earlier this month, Jim published an article about why ZMOT matters now more than ever. In Jim’s words, ZMOT is “the precise
moment when [people] have a need, intent or question they want answered online.” Furthermore, it “describes a revolution in the way consumers search for information online and make
decisions about brands.”

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Indeed, there’s probably no better explanation for Google’s success to date other than the fact that it cornered the market on ZMOT. But the times,
they are a changin’. Google is no longer the first (and last) place people go to search, especially when it comes to commerce. More and more consumers are bypassing Google and going straight to
sites like Amazon to search for (and buy) products.

Google, of course, is trying to change this behavior and create more of a full shopping experience through its own property. Whether
it’s Google Shopping Campaigns or Google Shopping Express,
it’s clear Google wants to own/monetize as much of the retail experience as it can. Meanwhile, Amazon has the luxury of being a marketplace where commercial intent is embedded in the fabric of
all site activity. And it has the relationships with brands and retailers needed to effectively match queries with relevant products at scale. So the only question really here is, what’s taken
Amazon so long to get in the game?

The answer is, Amazon’s been at this all along. It already offers Sponsored Products (for products sold on Amazon) and Product Ads (for products sold off Amazon). It’s really just a matter of creating the mechanisms to enable marketers to more
easily buy, serve, and optimize these ads. Amazon needs an AdWords-like platform or APIs with third-party bid management software companies to unlock the full potential.

It’s no slam
dunk, though. Amazon, like Google, faces some healthy skepticism from the marketer community about whether it can be trusted. As a merchant or brand manufacturer doing business with Amazon, do you
want to turn over key data points like what keywords are most valuable to you, what you’re willing to pay for them, and how many conversions you’re getting? It’s the same issue
marketers have when considering Google Analytics or any of the Doubleclick products. How do you know Google (or Amazon) is not going to jack up your rates once it knows your key metrics? Or leverage
the data to prioritize its own products and preferred partners?

At the end of the day, marketplace competition is what keeps all players honest and, thankfully, both Amazon and Google have
other serious competitors pushing the needle on innovation. eBay operates at the same kind of scale from a commerce standpoint and has a robust advertising
offering. And the Yahoo Bing Network sees its fair share of commerce-related queries and provides rich Product Ad
formats.

As both Amazon and Google expand far beyond their original scope (search and books respectively) into content, phones, home automation, even robots and drones, these companies are
building opportunities to engage consumers at all AMOT (All Moments of Truth). For now, the ZMOT remains the most profitable, though -- and the company that will win is the one that can make best
connect advertisers to those monetizable moments.